Shell divests interest in three oil blocks

Shell Petroleum Development Company of Nigeria Limited (SPDC), which is the operator of the SPDC joint venture, divested interest in three onshore leases and a major pipeline in 2015.

The company, which made this disclosure in its 2015 Sustainability Report released recently, said that the company’s performance metrics for Nigeria this year reflect, in part, these divestments.

Besides, SPDC Joint Venture has put its daily crude oil theft in Nigeria at 25,000 per day. At $40 a barrel, the company may have lost $365 million to crude oil theft in 2015.

Also, Shell Companies in Nigeria (SCiN) recorded seven fatalities in 2015, in four separate incidents.

According to the company, in one incident, four people lost their lives while working to remove an illegal tap point from a pipeline in the Niger Delta.

SCiN said that the incident is being investigated, in line with its procedures, and was taking steps to learn from what happened.

The Managing Director of SPDC and Country Chair of SCiN, Osagie Okunbor, said that the loss of life was a deeply troubling turn for SCiN after no fatalities was recorded in 2014. “Crude oil theft is a major issue, with attacks not only on pipelines but increasingly on flow lines and well heads”, he added.

The company believed that the divestment is a part of its onshore portfolio strategic review and complies with the goal of Nigerian government’s plan to encourage local companies in the upstream oil and gas business.

The company said that theft of SPDC JV crude oil on the pipeline network amounted to around 25,000 barrels of oil a day in 2015.

It noted that this was a reduction from around 37,000 barrels of oil a day in the previous year, which it said was partly due to continued surveillance efforts and implementation of anti-theft protection mechanisms on key facilities.

SPDC said that it will continue to clean up areas near its facilities affected by spills irrespective of the cause. “The number of operational spills fell from 37 in 2014 to 15 in 2015. The volume of oil spilled in operational incidents also fell from 3,000 tonnes of spills volume to 2,000 tonnes.

“The number of sabotage-related spills in 2015 declined to 93 compared with 139 in 2014. This decrease was due to divestments in the Niger Delta and increased surveillance and security by the Government of Nigeria. However, theft and sabotage are still the cause of around 85 per cent of spills from SPDC JV operations.

“In total, 133 new sites requiring remediation were identified in 2015, of which 23 were in Ogoniland. Of the total of 305 sites identified for remediation and certification at the start of 2015, 184 have been remediated and certified. 55 of these sites were in Ogoniland (representing a net reduction of 29 per cent in remediation sites in that area during 2015).”